Health benefit costs per employee are projected to rise 8.2% on average in 2027, the steepest increase since 2003, according to preliminary results from a Mercer survey of more than 1,800 employers. New reporting shows the strain has reached people who work in health care.
A Boise, Idaho, family physician and his pharmacist wife dropped insurance for their family of four this year after their Affordable Care Act (ACA) marketplace premiums rose to nearly $1,600 a month, KFF Health News reported. A nurse practitioner at a Boise clinic kept her coverage but gave up dental insurance to afford it.
Health Workers Facing the Same Bills as Patients
Joshua and Ashley Durham opened their family medicine practice at the end of 2023 and bought coverage on the ACA marketplace. When the premium for a similar plan rose by several hundred dollars this year, they chose to pay medical costs from about $50,000 they had saved in a health savings account. They have spent about $9,000 so far this year, more than they expected but still less than the premiums would have cost.
"It just takes, you know, one little accident, and then you got a big fat bill," said Joshua Durham, 47. The American Medical Association's code of medical ethics generally discourages doctors from treating themselves or relatives, with exceptions for emergencies and short-term, minor problems.
Samantha LeGault, the nurse practitioner, said her employer plan's monthly premium for herself, her husband, and four of their children rose from $700 to $1,500. She has Crohn's disease and two of her daughters have medical conditions, so dropping coverage was not an option. She estimated that about one-fifth of her income now goes to premiums.
In Norwalk, Iowa, Jill Kordick, a 64-year-old retired health care executive, saw her marketplace premium rise from $75 to $800 a month after enhanced federal tax credits expired. With a $10,000 deductible, she put off seeing a doctor for weeks for a sinus infection that later turned into an ear infection.
What Is Driving the 2027 Increase
Employers told Mercer their costs would rise 11% if they made no changes, and 59% plan cost-cutting moves such as higher deductibles. Mercer cited expensive new diagnostics and treatments, especially cancer therapies, and consolidation among health care providers. It estimated that growing use of GLP-1 weight-loss drugs accounts for about one percentage point of the projected increase. Mercer also pointed to AI-assisted billing software that has led to more claims and higher-level claims, and to higher-than-expected costs from payment disputes under the No Surprises Act.
Workers are likely to feel it in their paychecks. A separate Mercer survey found that about two-thirds of large employers, those with 500 or more workers, expect to raise employees' share of premium costs next year, NewsNation reported.
Small medical practices are squeezed from both sides. Jack Dillon, executive director of the Association for Independent Medicine, which represents 4,000 physician-led practices, told KFF Health News that premium increases have become untenable for small businesses. He said more health care employers may turn to alternatives such as higher hourly wages or minimal health plans.
Marketplace coverage has also grown more expensive for many people since pandemic-era enhanced tax credits expired at the end of 2025. The Congressional Budget Office has estimated that the number of uninsured people will rise by roughly 15 million over 10 years because of the expired credits and the 2025 federal budget law, according to Georgetown University's Center for Children and Families.
Who Is Most Exposed
Working in health care does not guarantee coverage. About 7% of all health care workers were uninsured in 2024, compared with 11% of all adults under 65, according to a KFF analysis of federal survey data. Doctors were especially unlikely to go without insurance, with 2% uninsured.
Health care workers with less advanced training, such as nursing assistants, home health aides, and medical assistants, often lack savings to fall back on and cannot treat themselves. Adults not yet eligible for Medicare, people with chronic illnesses, and self-employed clinicians who buy their own plans also face higher financial exposure.
These accounts are individual stories, not a survey of all health workers. The Mercer figure is also preliminary; final results from more than 2,000 employers are due later this year.
Protecting Your Budget and Your Health
Review your options carefully during your employer's open enrollment and the ACA marketplace enrollment period this fall. Compare total yearly costs, not just premiums, by adding the deductible and the out-of-pocket maximum. A plan with a low premium can cost more if you need regular care.
Most plans cover recommended preventive services, such as many screenings and vaccines, at no cost when you use an in-network provider. If cost is a barrier, community health centers offer sliding-fee care, and many hospitals have financial assistance programs that patients can ask about before or after treatment.
Going without insurance carries real risk. A single hospitalization or serious diagnosis can create debt that far exceeds a year of premiums. Do not delay care for warning signs: chest pain, trouble breathing, signs of stroke, a high fever that does not improve, or a worsening infection all need prompt medical attention.
Key Questions Answered
How much are employer health costs expected to rise? Mercer projects an 8.2% average increase per employee in 2027, the largest since 2003, based on preliminary responses from more than 1,800 employers.
Are health care workers really going without insurance? Some are. KFF Health News reported on an Idaho physician and his pharmacist wife who dropped coverage after premiums neared $1,600 a month. About 7% of all health care workers were uninsured in 2024.
What is driving the increase? Mercer cites costly new treatments, provider consolidation, GLP-1 drug use, AI-assisted billing, and payment disputes under the No Surprises Act.
Will workers pay more? Likely. About two-thirds of large employers expect to raise employees' share of premiums, and 59% of employers plan changes such as higher deductibles.
Who is most at risk? Lower-paid health workers, adults not yet eligible for Medicare, people with chronic illnesses, and self-employed people who buy their own coverage.
What can families do now? Compare total yearly costs during open enrollment, use no-cost preventive care, and ask about community health centers or hospital financial assistance if costs are a barrier.
Published by Medicaldaily.com
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